In 2013, growth in Africa remained strong at 4.8% as a result of continued investment in infrastructure and productive capacity. Inflation decreased from 9.1% in 2012 to 7.4%, favored by more stable food and energy prices and by the maintenance of prudent macroeconomic policies. Output in sub-Saharan Africa increased slightly to 5%, while inflation slowed to 6.8%. Five African countries were among the 10 fastest growing economies in the world: Côte d’Ivoire, Ghana, Liberia, Sierra Leone and South Sudan all posted growth rates of at least 8%.
Output growth notwithstanding, there has been insufficient economic diversification, job creation and social development to create the wealth necessary to lift millions of Africans out of poverty. Despite marked progress in some areas, the pace has been too slow to achieve most of the social development goals. In sub-Saharan Africa some 414 million people continue to live in extreme poverty, while continent-wide over 210 million are hungry, more than 600 million lack access to electricity, and only 39% have access to sanitation services.
In line with its founding mandate which requires OFID to focus its attention on the most underprivileged countries, Africa has received the lion’s share of the institution’s cumulative assistance. OFID’s presence on the continent extends to 49 countries, including all 33 of the region’s LDCs.
In 2013, some US$557.5m was committed in support of new projects benefitting 34 partner nations. In keeping with OFID’s strategic vision, just over 30% of the total, or US$169.2m, was directed at the energy sector for a range of initiatives encompassing both traditional and renewable technologies. The financial and transportation sectors also featured strongly, each attracting around 22% of approvals to the region. In terms of the type of financing, the largest share (US$352.3m) went in concessional public sector lending, primarily for energy and transportation projects.
A further US$116.0m was channeled directly to the African private sector, chiefly to help boost productivity and job creation among SMEs. Other private sector transactions included support to a regional telecoms initiative and to a greenfield aluminium manufacturing plant in Mozambique.
Trade finance activities accounted for US$79.7m, or 14.3%, of total commitments to the region and comprised lines of credit to banks in Ghana and Uganda as well as to the Afreximbank to help all three maintain their trade exposure, especially among SMEs.
The continent was also the recipient of substantial grant funding in 2013, with almost $9m being approved for 22 initiatives - several of them regional - across a wide spectrum of sectors.